Total crypto liquidations have surged, exceeding $1 billion in just 24 hours, as the cryptocurrency market capitalization tumbled to $3.98 trillion—a notable decline of $133 billion during the same period. The majority of the top ten cryptocurrencies faced significant losses, with around 90% falling into the red. Analysts indicate that the key catalyst for this market downturn is linked to the July Producer Price Index (PPI) report.
Crypto Market Sees Over $1 Billion in Liquidations After PPI Report Fallout
Data from BeInCrypto Markets revealed that the overall market dropped by 3.9% over the last day. Notably, all top ten cryptocurrencies, except Tether (USDT), recorded declines. Bitcoin (BTC) had slid to $119,098 at the time of reporting, following a high of over $123,700 just a day prior. This volatility reflects the rapid shifts that have become commonplace in today’s crypto landscape.
Crypto Market Performance. Source: BeInCrypto Markets
Ethereum (ETH) also experienced a downturn, plunging to a low of $4,452 before slightly bouncing back to $4,643, marking a decrease of 2.4% in the past day. Among the top ten coins, Dogecoin (DOGE) endured the steepest loss, its value plummeting by 10.3%. This widespread downturn has spurred a wave of massive liquidations, impacting a large number of traders.
Coinglass data highlighted that a staggering $1.02 billion in crypto positions were liquidated in just 24 hours, affecting approximately 221,364 traders. The bulk of these losses stemmed from long positions, which accounted for $872.37 million. In comparison, short positions lost $145.49 million, underscoring the fact that market sentiment had shifted unfavorable against those anticipating price increases.
Crypto Liquidations Over The Past 24 Hours. Source: Coinglass
Ethereum emerged as the cryptocurrency with the highest liquidation rate, totaling $351.8 million, which comprised $272.47 million from long positions and $79.36 million from short positions. This data accentuates the pressure currently being experienced in the market, as traders scramble to adapt to rapid price changes.
So, what exactly triggered this swift market collapse? Notably, crypto expert Michaël van de Poppe pointed to the PPI data as the primary driver. He emphasized that the narrative of “whatever news” typically impacts market prices, suggesting that the PPI figures played a significant role following a sequence of cascading liquidations on long altcoin positions. He stated, “This is why the correction is vital and steep.”
“There’s always ‘whatever news’ causing the markets to drop. The ‘whatever news’ is PPI. It’s just liquidations after liquidations on long positions on altcoins,” he posted.
The Bureau of Labor Statistics released the July PPI report on August 14, revealing a 0.9% increase in the PPI index, significantly outperforming economists’ expectations of a mere 0.2% rise. Year-over-year, the PPI escalated by 3.3%, indicating substantial inflationary pressures in the economy.
“On an unadjusted basis, the index for final demand advanced 3.3 percent for the 12 months ended in July, the largest 12-month increase since rising 3.4 percent in February 2025,” the report disclosed.
This unexpectedly high data has bearish implications for the crypto market, as it suggests daunting inflationary pressures that may lead to tighter monetary policy and elevated interest rates. Such conditions diminish liquidity availability, making traditional investments more appealing and consequently prompting a pullback from riskier assets like cryptocurrencies.
Additional structural vulnerabilities have compounded this turbulence. A recent post by Glassnode indicated that open interest in altcoins had reached an all-time high, intensifying the market’s susceptibility. According to their analysis, this concentration of leverage heightens reflexivity, amplifying both upward and downward price reactions and increasing general market fragility.
“This concentration of leverage elevates reflexivity, amplifying both upside and downside price reactions and increasing fragility in market structure,” Glassnode highlighted.
Scott Bessent, the U.S. Treasury Secretary, also stirred bearish sentiment with his remarks stating that the U.S. Strategic Bitcoin Reserve would solely be funded through seized assets rather than new acquisitions. Such comments, combined with market vulnerabilities and the troubling PPI report, have created a potent storm of factors leading to significant liquidations across the crypto market.
As the crypto market calms, investors remain on high alert, watching economic indicators and Federal Reserve actions closely to glean insights into the future direction of monetary policy.
